Hackathon 4-7: The messy middle
Since 9 out of 10 startups fail, let’s do 10! This is the fifth post in the Megacool Series about the middle four hackathons which was truly the messy middle.
I was not alone. Everyone I spoke to had the same issue; a large subset of those were duct-taping their needs with a messy spreadsheet.
"When a large enough group of people is solving something with Excel/spreadsheets, there's a business opportunity to be explored."
Whether it was a mentor's wise words or a nugget of wisdom gleaned from an article, I can't precisely recall. Yet, the sentiment had firmly lodged itself in my memory. Especially as one of my pain points previously doing business development for the mobile game studio Dirtybit was to manually keep track of my industry contacts in a five hundred row spreadsheet!
In this post, I'll explore our four middle hackathons from the summer of 2015. You'll join me on the roller coaster to uncover product concepts, highs, lows, and vital lessons gained in our pursuit of building a billion-dollar startup.
This is the fifth part of my Megacool startup journey. Here's an overview:
Part 1: How the Megacool journey began
Part 3: Embracing Failure – How we tested 10 different startup ideas over 10 weeks
Part 4: Hackathon 1-3: From AI travel agent to photo management adventures
👉Part 5: Hackathon 4-7: The messy middle 👈 YOU ARE HERE
Part 8: How we built our co-founder team
Part 9: From idea to live product
Part 10: Our bootstrapping hustle
Part 11: How we raised $1.6m in funding
Part 12: How we got acquired
Part 13: From Alpha to Acquired: The product, growth, and business model journey
Part 14: The emotional founder roller coaster
Part 15: The epilogue: Reflections on the whole journey
Hackathon 4: Personal Relationship Management System for Reminders (PRM, part 1)
In our quest for a better way to manage relationships, I found myself yearning for a CRM system that was not just functional but also personal. This became my main contribution to our idea backlog. We decided to call it PRM, an acronym for Personal Relationship Management, instead of traditional Customer Relationship Management. As we wrapped up a tumultuous week with Hackathon 3, we eagerly anticipated the challenge of addressing a problem that was not only substantial but also one we had personally experienced.
Through my experiences with previous startups, I discovered I had a knack for nurturing relationships, a topic I explored in an earlier post. Yet, I needed a structured system to manage these connections. A tool that would ensure I never missed a follow-up, a tool that was intuitive and empowering, aiding me in my endeavor to build meaningful relationships. I recognized the immense value my network could bring to any company, and having a system I could maintain independently from my employer would allow me to add value wherever I ventured effortlessly.
The primary pain points in my CRM experiences included:
Setting up with historical data, email records, and accurate mapping was time-intensive
Updating post-interaction was cumbersome
Maintaining it collaboratively across the team was challenging
Building on lessons from previous ambitious hackathon goals, we broke down the PRM challenge into three potential hackathons:
Overview
Pipeline
Reminders
We deemed the reminders segment as the primary distinguishing factor in existing solutions and chose to address it initially.
Our goals for the hackathon were to:
Learn: Is there a demand for a personal relationship management system focusing on reminders?
Learn: What's the price point people will pay for such a system?
Build: Create a working prototype that we can use ourselves.
Assumptions we had going into the hackathon were:
People need a system to structure and follow up their relationships.
Those who try to structure their relations are not using CRM but instead a spreadsheet.
There's a high barrier to entry to set up and use a CRM system for a private person or small startup, as you can't pay a Salesforce consultant to do it.
People are the value of their network, and when hired, they bring this value to another company.
Our hypothesis was: We believe that people are willing to pay for a PRM system to structure and follow-up on their relations with reminders. We know this is true when someone is willing to pay for it.
As we pursued PRM, we sought signals like enthusiastic responses such as, "This would save me SO much TIME—I'd pay for it!" or investor interest. Conversely, we'd abandon it if no one was willing to pay or the market proved overly saturated.
We kicked off the Learn phase with the following questions:
Are you using any CRM tools today? Why, why not?
How are you using it?
How do you manage your personal relations?
How do you follow up on your relations?
Are you using reminders?
Is this a pain point for you at all?
As a private person or startup?
How much would you be willing to pay?
One of the big 'aha' moments from the first Learn phase was the necessity of user-friendliness. We talked with numerous people who had wrangled with CRM systems, and they all sang a similar tune - these systems were often neglected or left to gather digital dust by their teams due to poor user experience.
Drawing inspiration from Backlog, we were smitten by Mailbox's clean and intuitive UX/UI. You know what they say about imitation being the sincerest form of flattery, right? So, we said to ourselves, why fix what ain't broke? And that's how our mockups came to life, following this very mantra!
We also envisioned incorporating gamification:
Begin with the five most recent interactions for an effortless start and process each contact to get to “Contact Zero”.
Make follow-ups enjoyable and hassle-free by suggesting pre-populated text for sharing.
Enhance the experience with satisfying sounds, like crumpling paper or crossing off tasks, upon completing an action.
We eagerly tested our first version but found that those we showed it to didn't grasp the problem we aimed to solve. We realized we had over-polished the experience, losing sight of the core issue the reminder function addressed.
During user interviews, someone mentioned LinkedIn's A/B testing of a similar idea. This imploded our balloon a bit. In retrospect, we've not seen that pan out. Where it went, whether it was published or not.. Just because "the big guys" are doing something similar doesn't mean they will do it better. There are several examples of small incumbents breaking through by having better execution in a somewhat monopolistic market. 👋 to Mailbox!
While we didn’t end up actually building something we could use, our key lesson from this hackathon was our tendency to jump into solution mode quickly, neglecting thorough understanding and true problem-solving through first-principle thinking. Unfortunately, this theme persisted across all our hackathons.
The Messy Middle: Money Making Machine (MMM)
Ok, so I'm quite embarrassed to share these next two hackathons. I'd actually appreciate it if you skipped to Hackathon 7…
No? Ok. Well then. Buckle up:
There we were, smack dab in the middle of our ten hackathons journey, and let me tell you; the pressure was starting to cook. Our quest for that billion-dollar startup idea was still a wild goose chase. The question loomed: do we keep "trusting the process"? Looking at my bank account, I was on a financial downhill slope, without any relief in sight. After two years of getting used to watching my savings grow from a safe job, the dwindling numbers were a tough pill to swallow. Was I even cut out for this entrepreneurial roller coaster? And mind you. We were just seven weeks in!
"Today is one of those days that I start to doubt how we're going to make it." — One of my journal entries.
I can't recall how, but we huddled up and decided the next two hackathons would reverse our fortunes. We were going to make some serious moolah. Cash, baby! CA$H! Now, if you've been following our journey, you'd know we had a thing for acronyms. So, we baptized our new money-making venture as MMM: the Money Making Machine.
Instead of googling: "how to make money," we huddled once again before our trusty old whiteboard. It was like our communal spirit guide, our go-to confidante when we were stumped and needed a nudge in the right direction.
We began by jotting down our ideas and organizing them. We categorized them into things that people require assistance with, things we are capable of helping with, and areas where technology could provide solutions. We aimed to identify concepts that could generate income effortlessly, even while we're not actively involved, aka "in our sleep" The ideas that emerged as the most promising were:
Startup advice
Automatic apartment research
Startup advice seemed easy and too simple not to pursue. And the second came from our own need for this service, and we assumed that we were not alone.
We had the week prior defined our mission: to pave the way and motivate entrepreneurs to follow their dreams.
Thus, our plan for the week was to
Hackathon 5: help other entrepreneurs and
Hackathon 6: help ourselves and others find their next apartment.
We started brainstorming for prototype 5 today. Lots of good ideas, but almost everything is done by someone else. Need to remember that execution is still most important. Not being first!
Hackathon 5: MMM – Get Startup Advice
Once we had narrowed it down to "Get Startup Advice," we once again summoned our best friend, aka the whiteboard, and listed out:
Our skills
What entrepreneurs need
This hackathon was spent ideating, building the landing page, and writing the blog post: Retrospective — The Most Important Hour With Your Team to help drive traffic to the landing page. How long we kept it up, I don't know.
Yet, as I sit here, my memory of this hackathon is foggy, leaving me with more questions than answers. Was answering startup queries for $10 a pop really a golden business opportunity? Well, hindsight is 20/20, isn't it?
Hackathon 6: MMM Catputer
We slept on the top floor of a small house in San Francisco's Noe Valley. I had a floor mattress while my co-founder, Nicolaj, occupied the bed due to winning our networking contest during the flight going to the US. Intriguingly, the mattress I used was formerly owned by the founder of The Silk Road, whose girlfriend once lived there—a testament to the quirks of Silicon Valley!
The house accommodated five of us with only one bathroom. This was peak housing pricing in San Francisco, with $2000 per room being the norm and $4000 for a one-bedroom apartment. While we enjoyed "only" paying $1600/month for this luxury, we felt the strain from the crowded and small house and desired a more long-term living situation. As deals disappeared before we could act, Nicolaj was glued to Craigslist, attempting to find something before it got snatched. To help with this, he proposed automating our search. We envisioned an email notification system for target listings to catch them when posted, recognizing that if we needed it, others probably did too. It felt too straightforward not to try.
We built a landing page where you could sign up for the service by providing a list of housing criteria. I vaguely remember that Craigslist ended up blocking our scraping attempts.
"We've launched our first MVP: a (manual) service that sends you an overview of new rental listings that matches your criteria. I thought we had made something that differentiated from what Craigslist is offering, but no. Never Ass-U-Me! Should have spent more time understanding and using Craigslist first."
Reviewing my journal, it's evident we aimed to gain clarity and validation by going live and trying to make money. Upon publishing the landing page, we realized our need for more understanding of Craigslist, which already offered something similar. Even if Craigslist didn't block us, we needed more differentiation, and our current angle was dead.
Although the week ended with a sense of loss and frustration, we tried our best to shift our mindset to applauding our efforts in exploring new avenues and publishing two new services live in just a week.
Rollercoaster. That's what we're riding! It was really nice to talk through our frustration with this week’s hackathons: make money right away. I never felt like we truly believed in any of the concepts, making it hard to stay focused and follow through.
The MMM hackathons' primary reflection was that we lost our cool. While we should have "trusted the process" and worked on something with more significant potential, we instead got desperate to solve our immediate need for financial stability. We hit our lowest point on the journey.
Hackathon 7: PRM Overview (PRM part 2)
Since it really felt like PRM was on to something, we decided to spend Hackathon 7 on addressing another part of PRM: PRM Overview.
Our goal was two folded:
Understand what all those (other) Excel/spreadsheet fanatics are looking for
Create a working PRM Overview system that we can use by spending at least 50% of our time in development mode.
We reached out to speak with other Excel fanatics in our network to understand their thinking and needs:
We talked with ten people, some more extensively via Skype calls (remember, we are back in 2015..) and others via email. Almost everyone had this issue and used a spreadsheet to combat their need. The opportunity was ours to fix. We believed that if we could fix it for ourselves, we'd solve the issue for others too.
We also noticed more interest and potential competition in the space:
And we came across Khe Hy's post: I couldn't find a good Personal CRM — So I created my own and want to share it with you. Today Khe is one of the prominent thought leaders on productivity and personal finance. In 2015 he had just started his new life as a solo entrepreneur writing his newsletter Rad Reads. Nicolaj messaged him via LinkedIn:
Unfortunately, Khe was traveling, so we wouldn't meet with him until mid-August.
In parallel to running the interviews, we decided to start building PRM Overview on top of Google Sheets and make the experience better and more accessible than Excel/spreadsheets.
One of our unique features at the time would be the tagging system to help manage connections:
"What a day!! We've completed Hackathon 7, and we can use it ourselves! Imagine that! I'm so freaking proud of us!"
By the end of the week, we had a working PRM that we could use ourselves. We used PRM without updating it until 2017 when we started using Propeller, a CRM company also working from Galvanize. Interestingly enough, with PRM, I remember I primarily used the tagging feature and not the reminder feature. Despite thinking reminders would be our main differentiator. This is probably because we didn't do much to reminders but focused on tags during Hackathon 7 instead.
The primary takeaway was how valuable it was to break down hackathons into different areas of problem focus. For instance, we went from creating a new kind of CRM app experience in Hackathon 4 to making a simpler CRM layer on top of Google Sheets in this hackathon. This helped us better understand the difficulties others face in this field. It broadened our empathy and gave us a clearer view of the challenges in developing effective solutions for the market.
By the time we dusted off our keyboards after the seventh hackathon, we didn't feel any closer to striking that billion-dollar business gold, but we had a working PRM that we could use ourselves! I had my heart set on PRM because it solved my personal needs. However, I was a little too protective of it, treating it like my precious baby. I felt even more lost when it became clear that PRM wouldn't be our flagship product.
I desperately needed a positive sign. While I kept my cool around other people, including my co-founder Nicolaj, I struggled with uncertainty.
"Lots of reflections today. I'm constantly walking around with knots in my stomach. But this is how it's supposed to be. It pushes us."
Looking at the state of PRM today, I'm convinced there's still a need. I'm still juggling between spreadsheets, Notion, and Tana databases (quite the circus act) since Propeller, unfortunately, had to shut its doors due to insufficient scale in 2019.
For the end user, there's such a massive barrier to getting started that I only believe something that "just works" and could map your contacts across a few sources and help you maintain it through gamification features such as the daily review from Readwise 1.0.
With a mere three hackathons left, the looming question persisted: would we find a problem with a billion-dollar potential and get the signals we needed to pursue? Continue reading the next part here: Hackathon 8-10: Wow, that’s megacool!
A special thanks to
for helping me find nuggets for this post.
...what a rollercoaster indeed...love how you all were so quick to pivot on your journey, yet learning every single step of the way...